South Australia plans to use Friday’s meeting of the prime minister and premiers to raise concerns about GST distributions before the state goes to the polls on 17 March.
While a hospitals funding row is expected to dominate Friday’s talks, the South Australian premier, Jay Weatherill, will also raise objections to a potential loss in GST revenue as part of radical changes floated last year by the Productivity Commission – recommendations that have also troubled other states.
“We already know the Liberals have cut $210m from South Australian schools and the Liberals are planning to cut South Australia’s GST revenue by $557m,” Weatherill said before the Council of Australian Governments meeting. “At Coag, I will be standing up for South Australia and fighting the Liberals’ savage cuts to South Australian schools, hospitals and GST revenue.”
A draft report handed down by the Productivity Commission four months ago put the cat among the pigeons on the GST carve-up, proposing a radical overhaul of distributions that would see Australia’s eastern states losing billions of dollars in GST revenue and Western Australia receiving a multibillion-dollar windfall.
Premiers facing elections in the first part of this year want the final report from the Productivity Commission, currently due for release after the May budget, to be made public sooner so the revenue implications can be made transparent.
The rising public agitation from premiers such as Weatherill has prompted senior players in Canberra to argue this week that they will speak up for the interests of their home state.
The education minister, Simon Birmingham, said future recommendations from the Productivity Commission would be discussed, and it was important to have a proper process, “but I can assure you that South Australian federal Liberal MPs will look out for South Australia’s interests”.
The premiers dined with the prime minister at The Lodge on Thursday evening before Friday’s meeting in Canberra.
Federal officials say the Turnbull government’s new hospitals funding offer is worth $128bn over five years but the Labor premiers have signalled in advance that proposal, put at officials level a week ago, is not good enough.
The New South Wales health minister, Brad Hazzard, said on Thursday the current health budget in NSW comprised almost one-third of the budget.
“Any new agreement would have to give capacity to deal with the anticipated growth in health funding through population pressures and increasing complexity of treatments,” Hazzard said.
He said he was hopeful consensus on hospitals funding would be reached “in due course”.
The proposed funding plan will set out federal hospital contributions for the five years from 2020. The agreement, which mirrors a previous deal struck in 2016, will have the commonwealth paying 45% of hospital funding and cap federal funding growth at 6.5% per year.
Canberra has also offered the states a proportion of a new $100m health “innovation” fund if they agree to sign on to the proposal at Friday’s meeting.
An extract of the draft heads of agreement circulating before Friday’s meeting obtained by Guardian Australia says 50% of the proposed $100m fund “will be made available for the use of states that sign up to this agreement on 9 February 2018, to be divided amongst signatory states”.
Given Tasmania is currently in a caretaker period, the draft heads of agreement makes it clear the offer remains current if the incoming administration signs up within two weeks of the swearing in of the next Tasmanian government.
It says all states, inclusive of any government signing on to the deal on Friday, will have access to the remaining 50% of the innovation fund from 1 July 2020 “once all states have signed this agreement”.
Friday’s talks will also cover Indigenous issues, schools funding, bullying, the response to the royal commission into child sexual abuse and the development of northern Australia, and there will be an update on national security.